The IMF slashed its growth forecast for
the Nigerian economy this year on Tuesday, saying a combination of
plunging oil revenues and weakened investor confidence will push it into
recession. The International Monetary Fund said it expects Africa’s
largest economy to contract by 1.8 percent this year, after having
forecast in April a 2.3 percent expansion. Nigeria’s stall, and sluggish
activity in the number two economy, South Africa, is expected to pull
down economic growth across sub-Saharan Africa, the IMF said,
forecasting a “dramatic implication.” “In 2016, regional output growth
will fall short of population growth, implying declining per capita
incomes,” it said.
Nigeria’s economy has been battered
hard by the plunge in oil prices, the main source of the country’s
income, as well as prices of other key commodities. In addition, rebels
in the southern oil region have forced crude production cutbacks, and
internal unrest, especially attacks by the Boko Haram group in the
north, has also hurt the economy. Inflation hit an 11-year high of 16.5
percent in June as prices of food and energy jumped after the government
freed up the naira currency in April, allowing it to plummet against
the US dollar. Also weighing on output have been electricity shortages
due to rebels’ sabotage of the gas pipelines that fire power plants.
Source – vanguardngr.com
Post a Comment